Seth Lafferty

Mortgage payments are broken into two parts:
-Interest- The banks fee. With a new mortgage, this will account for over 95% of your payment.

-Principal- The value amount of the loan. As you is down principal, you gradually own more and more of your home.

Taking advantage of lump sum principal repayments is a smart way to both reduce the length of your mortgage and lower your overall interest payments.

Did you know that as a homeowner, you are often restricted in your ability to remove foliage? Removing large trees (or parts of them) without express permission from the city can incur huge fines. If a large branch poses a hazard to the property and occupants removing it is rarely an issue, but must be done with the city’s consent.

If a property is under $500,000 a buyer can secure a mortgage for as little as 5% down. Only properties over $1,500,000 require a 20% down payment.

Facts

The ABCS of a home purchase. Closing costs to prepare for:

Deposit/Down Payment: 5-20% of the purchase price

Land Transfer Tax- 0.5-10% of purchase price, which varies based on municipality and purchase price.

Legal fees $2000-$5000. Including a lawyer in your purchase is not only a wise idea, it’s a requirement in Ontario.

Title Insurance $1,000. Technically not a requirement, but a smart idea to include.

Renovations: $500-$100,000+ Depending on what needs to be done, these can vary from minor fixes to major gut jobs.

Moving Fees $500-$1000

Adjustments $500-$5000: Adjustments for pre paid maintenance fees and property taxes to reimburse the seller.

Home Inspection $500-$1000 Home inspections are a top to bottom review of the homes condition. Not a requirement, but highly recommended if possible.

A great way to call a listing agents bluff.

ABCs of buying a home

B is for Blind Bidding. 99% of multiple offers are done through a blind bidding process in which buyers are not provided any information about competing offers.

The best way for buyers to navigate multiples is to be diligent in researching recent comparables to determine realistic market value, and put their best offer first.

Multiple offers are much more common in a hot market, but even today, quality properties in great areas are still seeing success with this strategy.

ABCS of a home purchase

A for Appraisal. Appraisals are performed for various reasons but most often are carried out by a lender when on-boarding or renewing a mortgage. Appraisers provide an independent, objective valuation of the subject property.

When buyers decide they are willing to pay over market value to secure a property, they may be obligated to make up that difference on closing.

A property is not worth what a buyer is willing to pay for it…it’s worth what the bank is willing to lend.